STING: The Right jabs pubradio with NPR fundraiser’s words

Neither Ron Schiller nor Betsy Liley had eaten before at Café Milano, the upscale see-and-be-seen restaurant in Georgetown, before Feb. 22, when they stepped into an elaborate trap that had been set for them there.

The two NPR fundraisers didn’t get the $5 million donation that was discussed by their lunch partners, and the president of NPR didn’t pose for a photo accepting a phony check, but those were the better results of the lunch meeting.

They couldn’t have expected that a hidden-camera recording of their talk with two prospective donors would cost Schiller his next job, put Liley on administrative leave, trigger the ouster of NPR’s president and severely undercut support for federal aid to public broadcasting.

Two weeks later, March 8, the consequences began tumbling into sight as right-wing activist James O’Keefe’s video of their lunch meeting spread virally on the Web.

NPR and public radio generally were now victims of a one-two punch — proud advocates of civil, principled journalism, suddenly reeling from quick jabs by practitioners of effective, if highly questionable, media trickery.

The first punch came Oct. 19, 2010, when Think Progress, a blog published by the liberal Center for American Progress think tank, released a 45-second video edited to highlight NPR news analyst Juan Williams’ most inflammatory remarks about fear of Muslims. (His moderating comments about tolerance were left out of the video.) NPR may not have been the liberals’ target, but the video prompted Williams’ dismissal and left many Americans thinking the organization fired journalists for sharing their honest, if politically incorrect, personal reflections on life in post-9/11 America.

The man called Malik (top) pays the restaurant bill. The bearded man called Kasaam (lower) appears in the sting video.

O’Keefe’s Café Milano sting provided a second punch, videotaping the fundraisers’ meeting with men from the fictional Muslim Education Action Center interested in giving $5 million to NPR. Then O’Keefe edited the footage to include the fundraisers’ remarks that would be most outrageous to conservatives and the least scrupulous to anyone who would notice.

For Ron Schiller and Betsy Liley, it was a getting-to-know you lunch with two prospective donors who had no previous history of giving money to NPR or public radio, yet wanted to contribute $5 million — an unusual offer, but not unheard-of, according to pubcasting veterans and NPR execs.

“Now I will talk personally as opposed to wearing my NPR hat,” Schiller (top) tells the men with the hidden camera. Liley (lower) considers the menu. (Images from Project Veritas video.)

Liley was still new to NPR; she signed on as senior director of institutional giving last July. Her boss, Schiller, had been NPR’s senior v.p. of development and president of its foundation since September 2009. Schiller had come from the University of Chicago, where he led a fundraising program that busted its revenue-growth goals, completing a nearly $2.4 billion capital campaign.

At NPR he had made unprecedented progress in creating arrangements that would help NPR and its member stations share the work and the gains from fundraising. Schiller sought to cultivate megagifts for both the news organization and its member stations.

The network created a Weekend in Washington event to engage big donors, attended by station execs, their board members, and their best major-donor prospects. NPR also launched Impact of Government, an ambitious enterprise reporting initiative to be supported through combined development efforts of stations and NPR, and Schiller laid the groundwork to pilot a new gift annuity program, approved by the NPR Board last month.

He expanded NPR’s development team from 24 to 37. Among the new hires last summer was Liley, a former journalist who had raised funds for Purdue University.

No nuances here

It’s not every day that a foundation eager to make a seven-figure gift — the kind MEAC pretended to be — turns up at NPR or any public radio station. Pubcasters with experience in donor relations said prospects inevitably go through a process of introductory conversation and mutual vetting.

“There’s a lot of nuance involved in getting to know a donor,” said Mark Vogelzang, a station exec who headed NPR’s development office in the interim before Schiller’s hiring. Donors usually become high-level supporters “through an established process where they become gradually closer to a station,” he said, by volunteering, or by being recruited to the board because of their expertise or prior community service.

“It’s very unusual to have someone approach us like that without prior contact or a relationship,” Slocum said. The staff typically tries to verify information about a prospect, as Schiller and Liley planned to do at lunch, but “there wasn’t a lot of information available from the sources our development people use to vet prospective donors,” Slocum said. The lunch was “an information meeting to understand more,” about MEAC, Slocum said.

It wasn’t until after the luncheon, at which MEAC’s phony representatives “started holding themselves out” as a nonprofit corporation, that NPR’s staff began looking for documents to verify the group’s legitimacy, Slocum said.

By then the inquires were too late. After O’Keefe’s video hit spun into the mediasphere March 8, it took out two of NPR’s top executives, blemished the news organization’s reputation for journalistic neutrality and fairness, and dealt a powerful blow to the field’s case for preserving federal funding.

Don’t take off your hat

Liley and Schiller went to Café Milano to meet men posing as Ibrahim Kasaam and Amir Malik, low-level members of MEAC and its charitable giving arm. They had hidden a video camera near Schiller’s seat at the table. Sound levels suggest that Malik, who described himself as a Nigerian who runs his family’s oil business from Louisiana, was miked.

The men were actually “citizen journalists” working with conservative activist James O’Keefe, 26, a self-described “modern-day muckraker” who has targeted organizations aligned with the political left and mainstream media outlets like CNN.

O’Keefe made his mark with a 2009 hit video that brought down ACORN, the activist group that advocated policies benefiting low-income people. Last year, he was arrested for attempting to tamper with the office phone system of Sen. Mary Landrieu (D-La.), but the felony charges were reduced to a misdemeanor and he was sentenced to probation and community service.

For the NPR sting, a man identified on the Project Veritas website as Simon Templar (borrowing the name of the slick fictional crimefighter of The Saint TV show and novels), took the lead. Posing as Kasaam, he described himself as a Houston-based futures trader and junior member of the trust’s board. He told NPR’s fundraisers that he had flown in on a red-eye flight to discuss MEAC’s interest in donating $5 million to NPR.

“The trust is very concerned with the discourse going on in the media, particularly as it pertains to Muslims and Muslim interests,” Kasaam tells his lunch companions. “The organization was founded by a few members of the Muslim Brotherhood in America. You can tell they’ve been demonized quite a bit.”

When Kasaam asks how the threat of federal funding cuts would affect CPB, Schiller explains the public radio economy, the potential financial harm to local stations, and past efforts to protect public radio’s independence by cultivating private sources of support.

Kasaam follows up with a question on the political dynamics of Congress, the first of many traps set for Schiller in the nearly two-hour conversation that would be heavily edited and released virally to inflict maximum political damage on NPR.

“Now I will talk personally, as opposed to wearing my NPR hat,” Schiller said. With that, Schiller, a fundraising professional with two decades of experience, violated a fundamental rule of donor solicitation. He went on to describe the “anti-intellectual mood” of the Republican Party.

Kasaam and Malik lured Schiller into a deeper discussion of politics, the role of federal funding in public radio, and bias in the news media. As he dined on a lunch of salad, risotto and wine, Schiller described Tea Party members as “racist, racist people,” bemoaned the hard-right swing of the Republican Party, and asserted that NPR would be “better off, in the long run without federal funding.”

These opinionated remarks not only ignored the code of ethical practices and standards of the Association of Fundraising Professionals but also contradicted NPR’s journalistic standards for neutrality, fairness and diversity of opinions, which Schiller repeatedly emphasized to his prospective donors.

Can’t buy our coverage

In the week after the initial 11-minute video and the two-hour uncut version came out, two quite independent analyses concluded that O’Keefe’s team had made unethical, misleading editing decisions. The first critique came from The Blaze, a news and opinion website published by Fox News host Glenn Beck.

“[E]ven if you are of the opinion, as I am, that undercover reporting is acceptable and ethical in very defined situations, it is another thing to approve of editing tactics that seem designed to intentionally lie or mislead about the material being presented,” concluded Scott Baker, editor of The Blaze, and a former associate of conservative flamethrower Andrew Breitbart.

Then, on March 14, NPR media correspondent David Folkenflik examined O’Keefe’s editing job with the help of Al Tompkins, who teaches ethics at the Poynter Institute in St. Petersburg, Fla., as well as Baker and other outside analysts.

Tompkins pointed to an exchange over NPR’s coverage of the Middle East, in which Kasaam jokes about NPR as “National Palestinian Radio.” After chuckles around the table, Schiller tells the donors that NPR’s editorial firewall prohibits funders from influencing content.

In Folkenflik’s report, Tompkins observes: “The message that he said most often — I counted six times — he told these two people that he had never met before, that you cannot buy coverage. He says it over and over and over again.”

In another exchange that was edited in a misleading way, Schiller appears to state his own opinion that the GOP has been “hijacked” by the Tea Party, but the longer video shows he was citing the views of two prominent Republicans who held that view.

But some of Schiller’s errors could be seen in both the short and long versions of the video. Jim Lewis, a recently retired fundraising veteran who mentored many professionals in public broadcasting, told Current that both versions of the video show Schiller making huge errors of conduct.

“I felt sorry for Ron for the way it was edited,” Lewis said but he still contended that Schiller should never have shared his personal opinions with a donor he clearly had never met before.

Schiller also faltered in how he managed the conversation. When Malik made inflammatory remarks about the Tea Party, for instance, Schiller nodded, appearing “to ingratiate himself to the donor,” Lewis said. “You don’t do that. That would have been a mistake in fundraising for the University of Chicago.”

“Ron allowed himself to get dragged into a discussion that fundraisers just shouldn’t have,” Lewis said. He advises fundraisers to steer clear of conversations about politics, social issues and “a whole host of other things” when meeting with station volunteers, donors or prospective contributors. When a donor makes objectionable remarks, he said, “you have to keep your cool” and respond only by citing facts and trying to correct misunderstandings.

NPR cited this as Ron Schiller’s main offense.

“Most people understand that Ron is not a journalist, and we’ve said that the views he expressed are not representative of NPR as an organization,” said Edwards, chair of the NPR Board and top manager at Milwaukee Public Radio. Schiller’s comments “don’t reflect the values of NPR, the listeners or people on our board. Those are the views of one individual.”

In the NPR statement announcing his resignation, Schiller said his remarks on the sting video “are counter to NPR’s values and also not reflective of my own beliefs. I offer my sincere apology to those I offended.”

When the lunch ended, Schiller and Liley walked out of the restaurant with Malik and Kasaam, and were seen exchanging business cards in front of a stretch limo.

It was Liley ‘s job to do the followup work pursuing the $5 million gift.

Kasaam’s assignment was to lure NPR President Vivian Schiller into his sting.

Having a photo with Vivian Schiller

The man posing as Kasaam continued to string Liley along after the lunch meeting and laid some traps for her along the way, according to additional audio recordings released by O’Keefe’s group.

“It sounded like you were saying that NPR would be able to shield us from a government audit — is that correct?” he asked in a recording of a phone call released on March 10.

Liley answers: “I think that is the case, especially if you were anonymous, and I can inquire about that.” And she sends him an email saying that NPR could accept the MEAC gift without disclosing the organization’s name. O’Keefe’s group posted a screenshot of the email online.

NPR spokeswoman Dana Davis Rehm said on March 10 that Liley’s statements about accepting an anonymous gift to protect a donor from scrutiny are “inaccurate and not reflective of NPR’s gift practices. All donations — anonymous and named — are fully reported to the IRS. NPR complies with all financial, tax and disclosure regulations.”

In a third recording, released on O’Keefe’s site March 17, Liley describes how NPR accepted grant funds from the Open Society Institute backed by financier/philanthropist George Soros but OSI declined its option to be credited via on-air underwriting blurbs.

The MEAC representative later talked with NPR President Vivian Schiller (no relation to Ron) by phone and pressed for a meeting to present the check. O’Keefe hasn’t released audio of this phone call.

Kasaam wanted a photo of the NPR president accepting the check, but he was rebuffed, according to Slocum, who was then NPR’s general counsel. She wrote to Kasaam on March 4, asking for an IRS letter certifying the trust’s tax-exempt status and federal Form 990 tax filings.

Slocum had another email exchange with Kasaam in which she offered to talk with trust representatives on March 6. But that conversation never happened, she said.

The jig was up March 8 when O’Keefe’s videos began appearing on conservative websites, including DailyCaller.com, co-founded by onetime PBS talk host Tucker Carlson.

The same tricksters tried to engulf PBS, too, but failed. PBS fundraising chief Brian Reddington had an initial conversation with MEAC representatives but he ended contact.

Ron Schiller had already resigned when the first sting video premiered. He had been planning to move to a new job in May with the Aspen Institute in Colorado. But NPR showed him the door on the evening of March 8, less than 24 hours after O’Keefe’s sting video went viral. The next day he withdrew his acceptance of his new job in Aspen.

Liley was placed on administrative leave pending a review other role in the episode.

Through an Aspen Institute spokesman, Schiller declined Current’s request for an interview. His public relations representative, David Goldin, did not respond.

Correction: The print edition of this article reported incorrectly that fundraiser Betsy Liley said George Soros’s Open Society Institute contributed anonymously to NPR. In fact, Liley said in the sting video that OSI declined its option to be credited on-air. The gift was publicized in an October 2010 NPR press release.

Neither Ron Schiller nor Betsy Liley had eaten before at Café Milano, the upscale see-and-be-seen restaurant in Georgetown, before Feb. 22, when they stepped into an elaborate trap that had been set for them there….

NPR is facing the most serious political crisis in its history with no chief executive to speak for it, no chief fundraiser to make sure its new building can be finished, and no chief journalist to rebuff or heed criticism of its newsroom. “People feel that they’ve been let down, and there’s this vacuum at NPR, and what’s next?” said Dave Edwards, chair of the NPR Board.

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